Loehman and Hsiao (1979) have further pursued the subject of agricul- 

 ture's impact on the Florida economy. Multiplier analysis often understates a 

 sector's full impact because it measures only changes dealing with final 

 demand. Tables were constructed showing the breakdown of basic agricultural 

 sales to processing and final demand for 1963 and 1970. Fishing and forest 

 products have a low output multiplier (1.239), but this is because over 90% of 

 sales are to processers and very little to final demand. When the related 

 processing sectors are examined, they have high multipliers and large exports. 

 All but three of the food and wood processing sectors rely solely on agricul- 

 ture. In 1970, total employment attributable to agriculture comprised 16.7% of 

 the State's total work force, whereas basic agricultural employment was only 

 7.7%. Personal income related to agriculture was 21.1% of total income, 

 although personal income derived from basic agriculture was only 13.5% of the 

 State's total personal income. The findings of Loehman and Hsiao on Florida's 

 agricultural sectors' impact on the economy are reported in Table 15. In all 

 sectors the writers believe that the impact of agriculture on other sectors is 

 much less in Northwest Florida than in other areas of the State. This is be- 

 cause the region is not a major producer of many of the State's farm products 

 and also because of its lack of a well developed and sophisticated industrial 

 and commercial base. 



AGRICULTURE AND OCS OIL AND GAS DEVELOPMENT 



Although currently there are few interactions between the agricultural 

 sector of Northwest Florida and OCS oil and gas exploration and development, 

 two potential threats should be considered. The start of intensive offshore 

 drilling could exact new demands on the labor market. The relatively higher 

 wages of oil workers, approximately $12 per hour (Charter Oil Co. August 1982) 

 as compared to farm hands, $3.34 per hour in 1980 (Greene et al . 1980) would 

 attract farm workers and possibly cause a temporary labor shortage. 



Long term and potentially the most costly conflict between agriculture 

 and OCS oil and gas production is the prospect of increased air pollution from 

 refineries built locally (see reports in this volume about minerals and oil 

 production, and environmental issues and regulations). Sulfur dioxide is one 

 of the main pollutants emitted during oil refining and heavy concentrations 

 kill plants. Sulfur dioxide in gaseous form combines with moisture in the 

 atmosphere and forms acid rain. Acid rain can seriously acidify natural, 

 unbuffered fresh waters or leach the soil and damage roots and leaves (Florida 

 Sulphur Oxides Study Inc. 1978). 



Other than these two potential problems the writer can see no other 

 possible conflicts between OCS oil and gas development and the agricultural 

 sector. The short run labor conflict is the product of an efficiently operat- 

 ing market. The conflict involving air pollution is the result of an exter- 

 nality, where the market does not operate efficiently. It is beyond the scope 

 of this paper to estimate the potential damage from pollution to farmers. In 

 short, it is anticipated that OCS leasing, if it has these impacts, will raise 

 costs for both the farmer and the consumer and may lower yields and output 

 thus raising consumer prices even higher. 



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